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When the amount of overapplied factory overhead is significant, the entry to close overapplied factory overhead will most likely require

A. A debit to cost of goods sold.

B. Debits to cost of goods sold, finished goods inventory, and work-in-process inventory.

C. A credit to cost of goods sold.

D. Credits to cost of goods sold, finished goods inventory, and work-in-process inventory.

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Question added by Deleted user
Date Posted: 2015/02/20
VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Option D  >>>>>>>>>>>>>>>>>>>  Credits to cost of goods sold, finished goods inventory, and work-in-process inventor

Ahmed Abdi Mahad
by Ahmed Abdi Mahad , Director of Internal Auditing Directorate , Jigjiga University

choice D, is the answer for your question. Thanks

Mir Mujtaba Ali
by Mir Mujtaba Ali , Internal Audit Manager , Confidential

I think I must opt C

When overheads are  over applied, generally we debit manufacturing overheads and credit the cost of goods sold

 

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